Objection to Pecuniary Jurisdiction Cannot be Raised Suo Motu After Settlement of Issues Absent Failure of Justice

The Appellant, a manufacturer of lubricants using the mark "LAIMAX" since 2009, filed a commercial suit in 2020 for permanent injunction and passing off against the Respondent, who used the same mark

An interim injunction was granted in 2021

After pleadings, discovery, and the conclusion of evidence by both parties, the matter reached the stage of final arguments in May 2025

During final arguments, the District Judge suo moto framed a preliminary issue regarding pecuniary jurisdiction and subsequently passed an order on 06.06.2025 returning the plaint under Order VII Rule 10 of the CPC, holding that the suit's valuation did not meet the ₹3 lakh threshold required for Commercial Courts under the Act of 2015

The Appellant challenged this return of the plaint.

Section 21(2) of the Code of Civil Procedure (CPC), 1908, which mandates that objections to pecuniary jurisdiction must be taken at the earliest opportunity and, where issues are settled, at or before such settlement

Harshad Chiman Lal Modi v. D.L.F. Universal Ltd., establishing that pecuniary jurisdiction is not a matter of inherent subject-matter jurisdiction and is waived if not raised before trial

Kiran Singh v. Chaman Pawan, holding that technical objections to jurisdiction should not be allowed to overturn a case tried on merits unless there is a failure of justice

Marg Limited v. Sushil Lalwani, which requires courts to allow plaintiffs an opportunity to correct undervaluation before dismissal

The High Court observed that the Respondent never objected to the pecuniary jurisdiction in the written statement, nor was any such issue framed during the trial

Under Section 21(2) CPC, the District Judge was precluded from returning the plaint at the final argument stage because the parties had already concluded the recording of evidence

The Court reasoned that allowing such a late objection results in "wasteful expenditure" of party resources and "judicial time"

Since the District Judge failed to record any "failure of justice" (the only exception under Section 21), the suo moto exercise of power under Order VII Rule 10 was legally unsustainable

Furthermore, per the precedent in Vishal Pipes Ltd. v. Bhavya Pipe Industries, the lower court should have allowed the plaintiff to amend the valuation to meet the commercial threshold rather than summarily returning the plaint

It held that the District Judge lacked the authority to return the plaint on pecuniary grounds during final arguments

The court restored the interim injunction dated 17.02.2021 and granted the Appellant two weeks to file an application for amendment of the plaint to appropriately value the reliefs

The parties were directed to appear before the District Judge on 18.05.2026 to proceed with the suit